There have been several major accomplishments within the past fiscal year. A variety of peptide ligands are known to inhibit the function of neuronal nicotinic acetylcholine receptors (nAChRs) including small toxins and brain-derived peptides such as beta-amyloid1-42 and synthetic apolipoproteinE peptides. The MARCKS (myristoylated alanine-rich C kinase substrate) protein is a major substrate of protein kinase C, and is highly expressed in the developing and adult brain. The ability of a 25 amino acid synthetic MARCKS peptide, derived from the effector domain (ED), to modulate nAChR activity was tested. In order to determine the effects of the MARCKS ED peptide on nAChR function, receptors were expressed in Xenopus oocytes and two electrode-voltage clamp experiments were performed. The MARCKS ED peptide completely inhibited ACh-evoked responses from alpha7 nAChRs in a dose-dependent manner, yielding an IC50 value of 16 nM. Inhibition of ACh-induced responses was both activity- and voltage-independent. The MARCKS ED peptide was unable to block alpha-bungarotoxin binding. A MARCKS ED peptide in which four serine residues were replaced with aspartate residues was unable to inhibit alpha7 nAChR-mediated currents. The MARCKS ED peptide inhibited ACh-induced alpha4beta2 and alpha2beta2 responses, although with decreased potency. The effects of the MARCKS ED peptide on native nAChRs was tested using acutely isolated rat hippocampal slices. In hippocampal interneurons, the MARCKS ED peptide was able to block native alpha7 nAChRs in a dose-dependent manner. The MARCKS ED peptide represents a novel antagonist of neuronal nAChRs that has considerable utility as a research tool. Second, we investigated crosstalk among different cholinergic receptor signaling systems. Cys-loop ligand-gated nicotinic ACh receptors (nAChRs) and G protein-coupled muscarinic ACh receptors (mAChRs) are expressed on rat hippocampal interneurons where they can regulate excitability, synaptic communication, and cognitive function. Even though both nAChRs and mAChRs appear to co-localize to the same interneurons, it is not clear whether there is crosstalk between them. We utilized patch-clamp techniques to investigate this issue in rat hippocampal CA1 interneurons in slices under conditions where synaptic transmission was blocked. The alpha7 nAChR-mediated currents were activated by choline, and when the activation of this receptor was preceded by the activation of the M1 mAChR subtype, the amplitude of alpha7 responses was significantly reduced in a rapidly reversible and voltage-independent manner, without any change in the kinetics of responses. This M1 mAChR-mediated inhibition of alpha7 nAChRs was through a PLC-, calcium-, and PKC-dependent signal transduction cascade. These data show that M1 mAChRs and alpha7 nAChRs are functionally co-localized on individual rat hippocampal interneurons where the activation of these particular mAChRs inhibits alpha7 nAChR function. This information will help to understand how these cholinergic receptor systems might be regulating neuronal excitability in the hippocampus in a manner that has relevance for synaptic plasticity and cognition. Third, we continued to explore how nAChRs may be controlling memory. The entorhinal cortex is a part of the hippocampal complex that is essential to learning and memory, and nicotine affects memory by activating nicotinic acetylcholine receptors (nAChRs) in the hippocampal complex. However, it is not clear what types of neurons in the entorhinal cortex are sensitive to nicotine, and whether they play a role in nicotine-induced memory functions. Here we have used voltage sensitive dye imaging (VSDI) methods to locate the neuronal populations responsive to nicotine in entorhino-hippocampal slices, and to clarify which nAChR subtypes are involved. In combination with patch-clamp methods, we found that a concentration of nicotine comparable to exposure during smoking depolarized neurons in layer VI of the EC (ECVI) by acting through the non-alpha7 subtype of nAChRs. Neurons in the subiculum (Sb;close to the deep EC layers) also contain nicotine-sensitive neurons, and it is known that Sb neurons project to the ECVI. When we recorded evoked EPSCs (eEPSCs) from ECVI neurons while stimulating the Sb near the CA1 region, a low dose of nicotine not only enhanced synaptic transmission (by increasing eEPSC amplitude), but also enhanced plasticity by converting tetanus stimulation-induced short-term potentiation (STP) to long-term potentiation (LTP);nicotine enhanced synaptic transmission and plasticity of ECVI synapses by acting on both the alpha7 and non-alpha7 subtypes of nAChRs. Our data suggest that ECVI neurons are important regulators of hippocampal function and plasticity during smoking.